Oklahoma City’s unwavering support for Tinker benefits Air Force, community

Throughout Tinker Air Force Base’s history dating back to the 1940s, Oklahoma City leaders have shown an ongoing willingness to support the U.S. military’s mission here however they can.

“There were a million reasons why it couldn’t be done, but no one focused on that. What people focused on was how it could be done.” -- Lt. Gen. Bruce Litchfield, former Air Force Sustainment Center Commander

The community’s longstanding partnership with the U.S. Air Force began when the Greater Oklahoma City Chamber raised the funds necessary in 1940 to acquire the land for an air depot that would later become Tinker. It continues today in ways that benefit the Air Force by strengthening its ability to serve the nation’s troops and that benefit Greater Oklahoma City by boosting its economy and bringing jobs to the area.

Most recently, these strong ties were evident with the recent acquisition of 156 acres of land north of Tinker from Burlington Northern Santa Fe (BNSF). The nearly three-year process was complicated, and getting the deal done took a lot creative problem-solving at many different levels – federal, state and local governments and private entities – and a lot of teamwork, phone calls, meetings and trips between Washington, D.C., and Oklahoma.

“It was really an incredible confluence of activity to make this (happen),” Lt. Gen. Bruce Litchfield, Air Force Sustainment Center Commander, said. “I would call it a ‘let’s get to yes’ kind of approach. … There were a million reasons why it couldn’t be done, but no one focused on that. What people focused on was how it could be done.”

The BNSF acquisition made all of Tinker’s land contiguous and paved the way for the maintenance home of the new KC-46A air refueling tanker. It also is expected to help insulate the base against future Base Realignment and Closure (BRAC) commissions because it adds an important new mission to Tinker and resulted in efficiency savings – more than $500 million over the next 50 years – for the U.S. Air Force. The project will bring at least 1,321 new jobs to the community with an average $62,000 annual salary and $75 million annual payroll.

The deal reiterated to the U.S. Air Force that the Oklahoma City-area community supports Tinker and is a willing partner in helping it succeed.

The complicated process culminated in February 2015 when the Chamber, the U.S. Air Force, the Oklahoma Industries Authority and city, county and state leaders closed the deal with BNSF with a celebration in the former General Motors plant adjacent to the BNSF railway. The former GM plant now houses aircraft maintenance and other operations as Building 9001 Tinker Aerospace Complex, which is part of the Oklahoma City Air Logistics Center.

The beginnings

Gen. Litchfield first called the Greater Oklahoma City Chamber in March 2012 to ask for help in acquiring the BNSF space for its new maintenance facility.

The Chamber had helped facilitate another project four years prior to that – acquiring the former GM plant and turning into the Tinker Aerospace Complex.

For the GM plant several years ago, the Chamber pulled together a team of people that could work to get the deal done in an unprecedented public/private partnership. The support was solidified when Oklahoma County voters supported a $55 million bond issue to fund the purchase of the GM plant. The first business unit moved into the complex in June 2009.

The Greater Oklahoma City Chamber led the way at the time in getting the right people together for negotiations for the GM project, and again between 2012 and 2015 for the BNSF deal.

“We do have the benefit of having a lot of strong communities around our installations, but it’s hard to think of a community that’s as supportive (as the one surrounding Tinker).” -- Jennifer Miller, then the deputy general counsel, Installations, Energy and Environment for the U.S. Air Force.

“We’re extremely appreciative of the efforts of the Chamber and Oklahoma Industries Authority and members of the community and the base really working to try to find solutions, really being forward-leaning and looking at every potential roadblock as a challenge to be solved,” said Jennifer Miller, then the deputy general counsel, Installations, Energy and Environment for the U.S. Air Force. “We do have the benefit of having a lot of strong communities around our installations, but it’s hard to think of a community that’s as supportive (as the one surrounding Tinker).”

The request from Tinker to the Chamber came when Tinker Air Force Base leaders learned the base was going to be the home of maintenance for the U.S. Air Force’s new tanker, the KC-46A. They knew they needed to find the best place to put the new facility and decided on the BNSF rail yard north of the current Tinker Aerospace Complex, said Lt. Gen. Bruce Litchfield, Air Force Sustainment Center Commander.

The BNSF location would give Tinker the ability to connect maintenance facilities – between the new ones for the KC-46A and Building 9001 in the former GM plant – and make all of Tinker’s land contiguous.

The KC-46A is designed to replace the Air Force’s current tanker workhorse, the KC-135; this mission is key to Tinker’s future.

“The way I say it is that the KC-135 has been the bedrock for Tinker for the last 50 years. And the KC-46 maintenance is going to be the bedrock for the next 50 years,” Litchfield said. Tankers give the Air Force the global capability to respond to any place, any time worldwide.

Too high a cost

To get the deal started, the Chamber reached out to BNSF, which had been using the area as rail yard storage.

BNSF’s answer: Buying the property was going to cost $75 million.

The U.S. Army Corps of Engineers had appraised the property at about $5 million or $6 million, said Gary Pence, the Chamber’s Senior Business Development Manager, Military and Aerospace. At the time, the Chamber-Air Force-city coalition had about $30 million available for the acquisition.

BNSF “never did tell us why they thought it was $75 million,” he said. “Most of the cars that they had stored in there were empty.”

Ironically, in 1979, the Chamber “sold” the property for $10 and “other valuable considerations” to the Atchison Topeka & Santa Fe Railway Co., which later became BNSF after a merger with Burlington Northern Railroad. Chamber records don’t show what the “other valuable considerations” were. However, Pence and Randy Young, director of military aerospace and aviation for The Chamber, believe that the land was donated by the Chamber for economic development. It had not been used as a rail line for about 12 or 13 years, Pence said.

So, Pence said, the group started negotiating, led by Pete Delaney, who was then the Chamber chairman and CEO of OGE Energy Corp.

Delaney said he got involved in order to negotiate directly with BNSF, chief executive to chief executive. After their conversations, BNSF came down from its original $75 million asking price to $55 million, and then finally to the final $44 million final number. Delaney said BNSF wanted to be able to replace the rail storage facility at Tinker with a similar one elsewhere and possibly purchase another rail line.

Litchfield praised Delaney for advancing the negotiations and keeping the deal on track.

“The Chamber was the orchestrator to make all this happen,” Litchfield said. “You know I give great, great, great, great credit to Pete Delaney, who was at that time acting as the lead for the orchestration of what had to happen from the business side. I would simply say that this wouldn’t have happened without the Chamber.”

Oklahoma County Commissioner Brian Maughan agreed.

“Pete Delaney was an amazing leader who just had the gravitas to pull that off. He deserves a lot of credit,” he said.

Delaney worked directly with the BNSF chief executive Matt Rose, who agreed to reduce the cost to $55 million as long as BNSF was able to acquire the Sooner Subdivision rail line, a railway line between Oklahoma City and Tulsa. BNSF had owned the property until 1998 and sold it to the Oklahoma Department of Transportation. But BNSF was outbid by Stillwater Central Railroad LLC, which is part of Pittsburg, Kans.-based Watco Companies, LLC. and which bought the line for $75 million.

As negotiations continued, Delaney and Rose worked out an agreement that included paying BNSF $44 million for the property. Now it was up to the parties involved to figure out how to pay for it.

Congress had appropriated $8 million for the property acquisition. Oklahoma County offered $12.5 million, which included $10 million in surplus funds from bond issue that voters approved to buy the GM plant and to protect Tinker and $2.5 million from another economic development-related bond issue.

“It was a no-brainer for us. … I felt totally confident in both cases that these bonds were approved by the voters for this specific type of intent. It didn’t take any stretch of the imagination whatsoever,” County Commissioner Maughan said. “I liked the fact that we went ahead and emptied them out and we had full reconciliation on those accounts.”

Finally, Oklahoma City was able to contribute $23.5 million to the deal, as long as funds could be paid back by the Oklahoma Quality Jobs Program Act.

That plan to use the Quality Jobs act led to another legal wrinkle, which led the team to ask state legislators for help.

“The Oklahoma City Chamber has always been there to help, even at the original establishment of Tinker. They have the wherewithal and the foresight.” – Randy Young, director of military aerospace and aviation for the Greater Oklahoma City Chamber

In the hands of the Oklahoma Legislature

If the Air Force had used the Quality Jobs tax credits for bringing the 1,321 jobs to Tinker, those tax credits would have been disbursed throughout the entire U.S. Air Force and not to Tinker, Young said. The Air Force had to agree to let the rebate come to a proxy organization within the community in order to pay back the city.

“Tinker’s going to get the benefit of the money one way or another,” Young said.

Kathleen I. Ferguson, then the Principal Deputy Assistant Secretary of the Air Force for Installations, Environment and Energy, worked to get approval, as well as the labor statistics and other data that the city would need to seek the Quality Jobs credits.

But to use them, state law had to change.

Oklahoma Rep. Earl Sears, R-Bartlesville, introduced House Bill 1416, co-authored by Sen. Mike Mazzei, R-Tulsa and others, to amend the state’s Quality Jobs Act to allow a public trust to receive the benefit by proxy of the tax incentives on behalf of a military installation. This bill gave greater flexibility for communities to use funds generated through the incentive for new job creation, land acquisition and infrastructure development.

It passed the state House and Senate in May 2014 with a unanimous vote in the Senate and nearly unanimous vote in the House and paved the way for the Oklahoma Industries Authority to accept the Quality Jobs funds that will ultimately be used to pay back both the county and the city for their contributions to the BNSF transaction.

Getting the deal done was extremely complicated – an “amazing feat,” Litchfield said. “This was by far and away the most interesting and complex business transaction that I’ve ever been a part of.”

Just as it looked like everything was going to work, the group faced another roadblock.

“It just seemed like one obstacle after another.” – Gary Pence, former Senior Business Development Manager, Military and Aerospace at the Greater Oklahoma City Chamber

More wrinkles

As the final negotiations on the deal progressed, both the Air Force and BNSF became concerned about liability regarding any environmental issues that cropped up related to the rail yard, Pence said.

“It just seemed like one obstacle after another,” Pence said. “I kept telling Randy (Young) with this project, just expect the unexpected because it’s going to happen.”

But, he added, they had learned from the state Department of Environmental Quality during the GM negotiations that there was such a thing as environmental insurance should anything unexpected occur. The U.S. Air Force paid for it during the GM transaction; this time, the city was able to buy a $20 million policy for 10 years for $269,000, Pence said.

BNSF still hesitated because of other dealings they had in the state; in December 2014, their concerns were addressed, and the transaction was nearly ready for closing.

The Department of Justice approved the final negotiations about a week before the Feb. 4, 2015, closing date.

Ongoing community support

Young, the Chamber’s director of military aerospace and aviation, said he saw the Chamber support Tinker throughout his career with the military and now.

“The Oklahoma City Chamber has always been there to help, even at the original establishment of Tinker,” Young said. “They have the wherewithal and the foresight.”

On this project, the community and federal, state and local governments had to work together to make it happen – starting with the Congressional appropriations to acquire land and build the facility and working its way through the leadership teams of the various organizations and governments involved, including the Chamber.

Young said some of his days started at 6 a.m. and ended at 11 p.m. with related phone calls to everyone involved in getting it to work. The effort involved different commands within the U.S. Air Force itself, all the way up to the Pentagon and the U.S. Department of Justice, which had to rule on whether some of these ideas were legal.

But the end result is a win for Oklahoma and the U.S. Air Force.

“Tinker isn’t the only beneficiary of this extraordinary effort,” said Oklahoma City Mayor Mick Cornett. “Greater Oklahoma City will benefit from the more than 1,300 jobs that will come when the maintenance facility opens. Aerospace is a key industry here, and the BNSF land acquisition strengthens Tinker’s future, as well as the area’s economy by bringing in more jobs and economic development.

“It was important for Oklahoma City to support this process, and it also shows how strong the relationship is between Oklahoma City and Tinker. The Air Force knows that it can call on the community for support anytime – and has in the past – and area leaders will do what it takes to make things happen for Tinker.”

The Air Force’s Miller said the area will allow a centralized, multi-hangar cross complex of 14 hangars and 850,000 square feet for the KC-46A operations.

Both Litchfield and Miller said that this deal was one of the most complicated land transaction deals they have ever worked on.

“I would tell you this: I never plan for failure. I plan for success,” Litchfield said. “And I never lost hope that we couldn’t make this happen. … It was a roller coaster ride.”

Former Chamber Chairman Delaney said it was worth it.

“It’s great for our region and its economic health, and it serves to further diversify our economy,” Delaney said. “Aviation is a big part of our state, and the BNSF transaction really helps that segment.”

‘Wingman culture’

“Oklahoma City gets the mission of what we do here. They understand that taking care of the people is critically important. But they also understand that if they can support our mission and an ability to help the community, when those overlap together, there’s no one going to stop us.” – Lt. Gen. Bruce Litchfield, former Air Force Sustainment Center CommanderLitchfield said he got emotional seeing the pride in the community at the ceremony celebrating the acquisition’s closing. Community leaders came together in a spirit of patriotism to get this done.

“The great part about being at Tinker is that we in the Air Force pride ourselves on having a wingman culture,” Litchfield said. “In Oklahoma, it’s safe to say that our wingman culture is not bound by the fence or what paychecks we receive. Everybody is operating together as wingmen.”

And now the $500 million project to build the maintenance facility on the former rail yard is expected to be completed by 2018 – the first jet is scheduled for its 12,000-hour maintenance check in April of that year, Young said. And many expect Tinker to get more missions in the future related to this facility, he added.

“Oklahoma City gets the mission of what we do here. They understand that taking care of the people is critically important. But they also understand that if they can support our mission and an ability to help the community, when those overlap together, there’s no one going to stop us,” Litchfield said.

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